Stemcor Said to Hire Restructuring Chief Ahead of Lender Talks

By Stephen Morris -
May 28, 2013

Stemcor Holdings Ltd., a London-based
steel trader renegotiating more than $1 billion of debt, hired
Simon Freakley as chief restructuring officer, according to four
people with knowledge of the matter.

Stemcor is due to meet with banks at Goldman Sachs Group
Inc. (GS)’s London offices on Thursday to outline proposals to repay
the debt, the people said. London-based Stemcor obtained a 30-day standstill agreement effective from the loan’s May 7
maturity, said the people.

Stemcor hired Goldman Sachs to advise on a refinancing and
potential asset sales as the company seeks to repay a $850
million loan that matured earlier this month, people familiar
with the matter said May 10. PricewaterhouseCoopers LLP and
Allen & Overy LLP are advising the banks, the people said today.

Freakley is a business recovery specialist employed by
Zolfo Cooper LLP, a restructuring advisory firm, and the former
head of Kroll Inc., according to Zolfo Cooper’s website.
Companies involved in debt restructuring processes often hire
people from accountancy firms or advisory businesses to lead
negotiations and help manage organizational changes.

Charles Armitstead, a London-based Stemcor spokesman who
works for Pendomer Communications LLP, declined to comment on
the situation. Spokesmen for PwC and Zolfo Cooper, who both
asked not to be named citing company policy, declined to
comment.

Asia Loan

Stemcor’s standstill, under which banks agree not to demand
repayment of the loan for a specified period of time, also
applies to a one-year $225 million loan raised by Stemcor’s
Asian unit Stemcor SEA Pte Ltd., people said earlier this month.

Stemcor reported a loss last year as sales fell to about 5
billion pounds from about 6 billion pounds a year earlier,
according to a statement on its website. Reduced demand for
steel in recession-hit Europe drove down the prices of hot-rolled coil, a benchmark steel product.